Shell-shocked businesses are reassessing investments and jobs after being slugged by huge increases in their electricity bills driven by the imminent closure of the giant Hazelwood power station combined with hot weather and rising "green" power costs.

As commercial customers go to renew their power supply contracts, they are seeing a direct hit from the spike seen in forward prices for electricity in recent months. The Hazelwood closure, set for the end of March, has also heightened worries about the risk of blackouts on a grid with reduced access to baseload power.

Hardware manufacturer Alchin Long Group in Sydney's west has had to agree to a near-doubling of its electricity price and may rethink plans to shift work back to Australia from China as a result, said Graham Lee, national operations manager. The price of the new two-year contract from Origin Energy has surged from $55.30 per megawatt-hour to $109.70 .

"We have yet to see an invoice, they will be coming in the next few months, but I'm bracing myself for a huge increase," said Mr Lee. Prices offered by rival suppliers ranged up to $129.96/MWh.

"We are in the process of reviewing bringing back work to Australia out of China due to the cost increases there, [but] with a large rise in our primary input costs maybe we need to reconsider."

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Aluminium scrap processor Weston Aluminium, which uses about $600,000 of electricity a month, pays $57/MWh on its existing contract coming up to expiry and is hearing prices of $150 in the market, said managing director Garbis Simonian.

Suppliers quoting such huge increases are reacting to Hazelwood's closure at the end of the month and the likelihood of shortages and price spikes similar to those already seen in South Australia being repeated in NSW and Victoria, Mr Simonian said.

"We cannot reduce [our electricity demand]. If the electricity and gas triple there's going to be a lot of people in trouble," he said.

Business power retailer ERM Power has reported a 170 per cent hike in electricity contract prices for commercial customers in Victoria and South Australia from two years ago as wholesale prices surge.

Average spot power prices in February across the states were between 98 per cent and 360 per cent higher than a year earlier, with prices in Queensland averaging $239.60/MWh, according to Citigroup. Forward prices are up in all states by as much as 33 per cent month on month, with all states now above $100/MWh for 2017-18.

The chief executive of Australia's largest aluminium smelter said they had to curtail production in recent months because of the spike in electricity prices which was "crippling" the business.

Tomago Aluminium's Matt Howell said while they had most of their energy needs secured by long-term contracts with AGL Energy, the 50 megawatts of power needed from the spot market left them still exposed.

"We have to grow to be competitive and to be ahead of the curve, but when the spot price went to $14,000 [per megawatt hour] we had to take that load off. It's just not sustainable. You can't smelt at that price. We have had to curtail or modulate the load [on occasions] or we get hammered by the price," Mr Howell said.

"We cannot continue to keep paying those prices. We have to find a solution. The prices are crippling."

BlueScope Steel and Incitec Pivot have both been hit by soaring power prices, while Rio Tinto's Boyne Smelters has cut back output and about 100 jobs. Big hikes in gas prices are compounding the energy woes for some manufacturers. Smaller businesses without the bargaining power to negotiate a cut-price deal are often worse hit.

Packaging group Orora has seen a doubling in electricity and gas prices in the past 12-18 months forcing it to review where it does business, said chief executive Nigel Garrard.

"If you run a business over a number of different countries as we do you have got to look at your cost of operations and where you are going to put your manufacturing," Mr Garrard said.

"Our gas price in the US [Midwest] is less than half the Australian price and our electricity price is probably less than half the current pricing in Australia."

Business leaders fear that the removal of Hazelwood's 1600 MW of capacity in Victoria's Latrobe Valley will endanger supply security long before any results emerge from the review into energy security being led by Chief Scientist Alan Finkel.

"That's 1600 megawatts that is not going to be immediately replaced. Had that occurred this summer it's fair to say it would have been disastrous," Mr Howell said.

Manufacturing Australia executive director Ben Eade said the biggest issue is "short term", with a shortage of gas for gas-fired generators adding to the problem.

"We have got confidence that Finkel is going to come through with some good things for the medium and long term," he said.

"But frankly if Hazelwood closes at the end of this month as it's expected to do and Pelican Point doesn't get access to the gas it needs to operate then the blackouts we have seen in South Australia will be repeated next summer in NSW and Victoria.

"The system is just not ready yet for this withdrawal of baseload and spinning reserve."

The Energy Users Association of Australia said its members had faced unprecedented increases in power prices over the past five years.

In its submission to the Finkel review, the EUAA included confidential member data that showed electricity and gas prices increases of between 80 per cent and 120 per cent had become the norm, with some companies facing increases of over 150 per cent.

"One member has seen a $15 million price increase for gas in the last two years for the same supply. Another had received a bill this year with a $20 million increase in electricity costs from the previous contract," EUAA chief executive Andrew Richards said.

"Unless these issues are addressed we do not believe Australia will regain its comparative advantage in energy, putting the medium to long-term survival of many of our members at risk."